Possible Consequences of Top Sharing in Terms of Personnel Law

Table of contents

I. Explanation

III. Index of figures

IV. Abbreviations

1 Introduction

2 Principles of Top Sharing

3 Types of Top Sharing
3.1 JobSharing / JobSharing in a work team
3.2 JobSplitting / `Not proper` JobSharing
3.3 JobPairing / JobSharing in own group

4 Basic legal conditions
4.1 Concepts
4.1.1 Working hours
4.1.2 Work content/duties
4.1.3 Joint substitution and overtime
4.1.4 Termination of employment
4.1.5 Co-determination of employment
4.1.6 Liability
4.1.7 General rights
4.2 Contract of employment
4.3 Particular apects of individual forms and possible consequences
4.3.1 JobSharing/JobSharing in a work team
4.3.2 JobSplitting/`Not proper` JobSharing
4.3.3 JobPairing/JobSharing in own group

5 Conclusion

6 Index of tools and sources

7 Appendix

III. Index of figures

Fig. 1 Overview of a sub-area of top sharing model

Fig. 2 Overview of a sub-area of top sharing model

Fig. 3 Overview of a sub-area of top sharing model

Fig. 4 Basic legal conditions in sub-areas

Fig. 5 Particular legal features of top sharing opportunities

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IV.Abbreviations

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1 Introduction

In German small and medium-sized companies, the question of how highly qualified employees can be retained and migration to other companies can be prevented is more frequently being considered.

Globally competing German companies are also faced with the challenge of how employment structures, which are a factor of strategic success, can be made sufficiently flexible to ensure that they are compatible with the different environmental and competitive structures. There is also the matter of how Germany will adjust to the difficult market situation in January 2010^[1], in which there are around 3.62 million unemployed people who are capable of gainful employment and, at the same time, an increasing shortage of academic and professional staff.^[2]

As a result of the above problems, the emerging demographic changes, and the existing legal opportunities for parental leave with which companies will have to cope, it is necessary to rethink personnel policy in order to ensure the future viability of companies.

Against this background, organizations must take practical advantage of the scope which exists with regard to managerial staff and provide them with the necessary indi­vidual freedom to increase their commitment to the organization. It is foreseeable that there will be an increase in the demand for new and innovative forms of contract. This will be necessary in order to accommodate the wishes of employees and to ensure that they remain with a company.

That is because it is necessary to secure the commitment of this now highly prized commodity, knowledge holders. Companies expect a high level of performance and commitment from their employees. However, managerial staff has their own expecta­tions of a company. In order to secure the commitment of good managerial staff in the long term, more and more companies are being required to offer managerial staff other incentives and benefits in addition to appropriate remuneration of their performance.

It is during the phase of induction of managerial staff that companies incur high costs, e.g. as a result of training measures and familiarization with the company structure. It is only as a result of the integration and good work performance of managerial staff that it is possible to absorb these costs. Thus, this can entail a high financial loss for companies if these knowledge holders defect to the competition after a short period of time, e.g. because of higher remuneration or a better working environment.

But how can such possessors of potential be retained and is it solely a matter of pay­ment? If that is the case, how can small and medium-sized companies hold their own against large corporate groups which usually have to offer more diverse opportunities, including financial opportunities?

In the German economy, it is becoming more and more apparent that good managerial staff is becoming less willing to forego a good work-life balance between their profes­sional and their private life. When choosing an employer, quite a few applicants for professional managerial positions are paying more and more attention to where they can find their private interests, family tasks and career being catered for under one roof in addition to the prospect of performance-related pay.^[3]

An important area for personnel policy when it comes to the attractiveness of a company from the point of view of employees is, among other things, the availability of flexible working hours. Even in the 1990s, Germany was one of the leaders in Europe when it came to offering flexible working hours. This was also as a result of the situation in which many highly qualified employees who would otherwise have had to be dismissed on account of the existing economic crises and resultant lack of work were able to continue to be available to the company in at least a part-time capacity.^[4]

However, particularly in the case of men, there are often still high obstacles to part-time work, since the reason for a reduction in working hours continues to play a role in the case of many employers. Thus, a short period away from work for the purposes of childcare is indeed possible as a result of the new legislation regarding parental leave according to the Bundeselterngeld- and Elternzeitgesetz ('Federal Parental Allowance

and Parental Leave Act') which was introduced in 2007, but is still not taken up by relatively many men. One of the possible reasons is the financial background, but there is also the lack of opportunity for part-time work within the company.

Since the number of fathers involved with parental leave has risen from 7% in 2007 to over 18% today, it can be assumed that more men are considering flexible working hours in order to achieve a better balance between career and family.^[5]

How can small and medium-sized companies gain a competitive advantage for them­selves as a result of this flexibility approach and satisfy the potential of fathers who wish to have a part-time position? What is the cost of implementing possible working hour models and what are the possible legal consequences of doing so?

One way of securing the commitment of the possessors of potential is to establish fle­xible working hours or to shorten the working hours. The Teilzeit- und Befristungsge­setz (abbreviated to TzBfG) ('Part-Time and Fixed-Term Employment Act') which was passed on 01/01/2001 offers employees, including managerial staff with employee sta­tus, the right to implement part-time working in the company. The Act is of particular interest to highly qualified staff after their return from parental leave. At the present time, there is often a desire for reduced working hours.^[6]

There are often already a high number of innovative working hour models to choose from in companies. Just taking a look at the wide range of flexible working hour models which are available at present shows what innovations have been seen in this area in German companies in recent years.

These flexible working hours increasingly make it possible for managerial staff to a­chieve a balance between their professional and their private life. Since managerial staff often does not take advantage of these innovative models, the performance and competitiveness of this particular group can suffer, since a future-oriented organizational and managerial structure will involve the inclusion of not only the conditions of the business management, but also the conditions of the personnel management in company planning.

As a result of the large number of available media, it is becoming more and more pos­sible for employees to inform themselves about future employers. Thus, Internet forums provide information about innovative, new working hour models in companies and the structure of jobs. For example, the Internet platform Genderdax provides highly quali­fied women with an overview of employment and career opportunities in companies in Germany.

Genderdax started in the spring of 2005 with only a few companies. In November of 2008, 40 companies belonged to it, including Commerzbank, Deutsche Bank, Dresdner Bank, WestLB, E.ON, Randstad and Lufthansa.^[7] The increase in the number of com­panies involved shows that more and more companies have obviously recognized that, in addition to appropriate remuneration, a good balance between private and professi­onal lives is important for many managerial staff.

Top sharing is one of the many opportunities afforded by part-time working. By top sharing the division of managerial duties between two qualified members of the managerial staff who have contracts of part-time employment is meant.

Up until now, the importance of top sharing conditions in Germany has remained low in practice. Various surveys have reached the conclusion that distribution is to be found in the thousandths. The known top sharing pairs have been exclusively entrusted with managerial duties in the middle management of companies or government departments. Up until now, there have not been any notable top sharing pairs in high managerial positions in MDAX companies in Germany.

The situation has not changed since the coming into effect of the TzBfG. However, it is increasingly to be observed that parties to collective work agreements are now increasngly considering the matter.^[8]

As a result of this organizational form, companies should feel encouraged that they are now able to offer employees different management models with a view to giving the possessors of potential an opportunity to achieve a better balance between their priva­te and professional lives and to securing a greater positive commitment to the compa­ny.

In her study paper, the authoress would like to:

-present top sharing;
-explain the origin of the term;
-help companies make the decision to implement this working hour model for the first time;
-and give the legal forms of employment contract for top sharing pairs.

A look will also be taken at possible problems as well as legal consequences.

When it comes to qualified employees who would like to take advantage of the oppor­tunity to resume work in high managerial positions after parental leave, there is, in the view of the authoress, considerable potential available to companies. The top sharing model can result in the greater loyalty and commitment of employees who are already employed at the company as well as the gaining of new highly qualified employees who wish to have a good work-life balance.

This is because the loyalty of employees to the company has other advantages apart from the cost benefits which result from savings when it comes to induction and trai­ning. Thus, it has been established in a study of part-time managerial staff that flexible working hours have been found to have positive results. Thus, the managerial staff have reported having greater enjoyment of work, greater job satisfaction, and greater intrinsic work motivation.

In the area of employees’ private lives, there have more frequently been opportunities for relaxation and there has been less stress as a result of there being less pressure with regard to time and planning. At the same time, there has also been better use of resources.

Companies have also been able to confirm improved efficiency at work as a result of better targeted work, fewer periods of absenteeism and often a better quality and quan­tity of work. An increase in the loyalty of employees has also been observed. At the same time, flexible working hours have resulted in managerial staff taking greater responsibility and work processes have also been examined. The study has also shown that managerial staff who have more flexible working hours develop new forms of competence in the management of employees as well as in self-management.^[9]

The more varied the forms of employment offered by the company, the greater is the probability that employees will show a positive commitment to the company.^[10]

Apart from the origin and a definition of top sharing, the study paper will present the different forms of employment which are to be found in the German legislation, it will provide an overview of the opportunities for implementation and the necessary conditions in companies, and it will present the advantages for employers. The study paper is to be seen as being closely linked with the final paper on the topic of top sharing.

Comment:

To make the text easier to read, only the male form will be used when referring to peo­ple in the study paper, although the female form is also to be understood.

In the study paper, the Betriebsverfassungsgesetz (BetrVG in short) will be considered, since reference is made to the works council in legal texts and commentaries. Howe­ver, the authoress will proceed on the basis of similar decisions of the courts with regard to the rights to co-determination of staff representation in accordance with the basic legal conditions which are included in the Personalvertretungsgesetze ('staff representation acts') of the Federation and the Federal States.

The representation of employees (employees under the terms of collective agreements and civil servants) in departments of public authorities is meant by staff representation, and it is similar to the representation of employees in businesses in the private sector (works councils).

2 Principles of Top Sharing

The idea of job sharing originally came into existence during the 1980s in the USA. The definition is to be attributed to the American Barney Olmsted (1977), who described job sharing as a voluntary working arrangement between at least two part-time employees. Newer definitions expand upon this and understand job sharing as a collective term which is used to refer to different ways of dividing working hours and duties which are not to be confined to only two people.

A requirement for job sharing is the existence of a job which is defined as full time, but which can be undertaken as a part-time job on a job sharing basis. The participants share a job as well as a salary. However, other models with, for example, 4 jobs with 5 employees are in theory possible. The employees can arrange the working hours in a flexible way within the overall working hours.

From the TzBfG, the legal definition for the right of employees to part-time employment can be found. All those employees work on a part-time basis whose regular weekly working hours are shorter than those of similar full-time employees in the company. According to this definition, job sharing employees are part-time employees.

At the end of the nineties, the idea of a project which was entitled top sharing was introduced to the Netzwerk Arbeitsgemeinschaft "nag" in Zurich by Julia K. Kuark and Hansurlich Locher. The project was based on the idea of establishing job sharing under the term top sharing also at managerial levels in Switzerland.

The division of a job in a managerial position is a working hour model which is based on two part-time managerial staff. The top sharing project promotes a partnership ma­nagement model, and it is directed at professional work and management duties. The project was tested and evaluated with two companies in Switzerland as well as the Finance Department of the Swiss Federation.^[11]

[...]

^[1] Cf. Bundesagentur für Arbeit (Federal Employment Office): Der Arbeits- und Ausbildungsmarkt in Deutschland (‘The Labour and Training Market in Germany’) – Monthly Report January 2010, Nuremberg 2010 p. 13

^[2] Cf. w/o editor: Die OECD erhebt neue Zahlen (‘Acquisition of New Figures by the OECD’), http://www.bildung-news.com/news/panorama/akademikermangel-in-Deutschland/, 04/02/2010

^[3] Cf. Bessing, N. Work-life balance: Advantages for employees and organizations in Krell, G. (Publishers) Equal oppor­tunities as a result of personnel policy: Equal treatment of men and women in companies and government departments - Legal regulations - analysis of problems - solutions, 5th Edn., Wiesbaden 2008 pp. 417 ff.

^[4] Cf. de Grave, A., Flexible working hours as a factor of strategic success: an example from practice, in Becker, F. (Publishers) Personnel Management, Organization, Company management, Lohmar 2004, p. 145

^[5] Cf.: Fathers on parental leave http://arbeits-abc.de/vaeter-in-der-elternzeit/, 07/02/2010

^[6] Cf. Schönefeldt, U.: Part-time working and job sharing - not a topic for managerial staff, in personnel management 12/2006, pp. 30 ff.

^[7] Cf. Genderdax homepage, http://www.genderdax.de/index., 06/02/2010

^[8] Cf. Löw, H.-P.: Job sharing/flexible model with a future?, in: Employment and employment law - Personnel professio­nals 10/2006, pp. 592 ff.

^[9] Cf. Bessing, N. Work life balance: Advantages for employees and organizations in Krell, G. (Publishers) Equal opportunities as a result of personnel policy: Equality of men and women in companies and government departments Legal regulations - Analysis of problems - Solutions, 5th Edition, Wiesbaden 2008 pp. 417 ff

^[10] Cf. Domsch, Kleiminger, Ladwig, Strasse: Job sharing for managerial staff, in: zfo 02/1998, p. 95

^[11] Cf. Kuark, J.K., Top sharing model leaflet, Working together at the top, 1st Edn., Bruges 2003, pp. 2 ff.